ROI on energy efficiency for small building portfolios

Of the 4.8 million commercial buildings in the US, 98 percent, by number, are small or medium size (under 100,000 square feet). Options for larger buildings include real time BAS or EMIS systems where the economics of energy efficiency can justify a larger investment. How do we address the building stock of small and medium size buildings that make up 60 percent of the total floor space?

Let’s think about energy efficiency not as an engineering problem, but as a business process, driven by financial return. The economics are simple. With average energy cost of $2.44 per square foot for commercial buildings in the US, achieving a 10 percent reduction in energy will yield 24 cents per square foot savings annually.

Is it possible to incorporate energy efficiency into your business processes which can give you a 5-10 percent energy saving, and a simple return on investment of less than a year? I think this is possible and necessary to reach energy efficiency goals.

You can’t manage what you can’t measure. Measuring, and understanding, energy consumption, and creating a baseline for each building is core to energy management. Comparing each building to other benchmark buildings across your portfolio, helps further understand consumption across the portfolio. But measurement and benchmarking is not sufficient.

It is people taking action that actually saves the energy. BuiltSpace goes beyond energy measurement to help building stakeholders take action on energy and building efficiency. We believe in a better approach to establish business processes across your portfolio which drive continuous improvement. Continuously maintaining better quality information about energy consumption, equipment and asset condition, building use, and occupant comfort, improves operational decision making, while reducing both maintenance and energy costs.

Collecting real-time energy data is not necessary for this approach. Utility bill data is a great start, and with smart meters now coming online, data quality and availability is improving. A growing number of utility companies are now providing your building energy data via direct electronic access such as the “Green Button” program which was initiated as a challenge by the US Federal Government.

Real time systems could cost several dollars per square foot to implement in smaller buildings, and 5-10 cents per sqft for ongoing operation. BuiltSpace can provide utility based measurement for about 2 cents per square foot per year, regardless of building size.

If you manage a portfolio of buildings, and want to create an integrated management system which incorporates energy and water efficiency into your business processes, I invite you to try BuiltSpace at no charge on your first building.

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About Rick Rolston

Rick is CEO of BuiltSpace Technologies Corp. (Vancouver Canada). BuiltSpace provides integrated building information management services to help building stakeholders create more sustainable and valuable building ecosystems.